Luxury label Mulberry has blamed the “difficult” economic climate in the UK and Europe coupled with international expansion costs for a £10m decline in profits.
In the year to March 31 total revenue fell from £168.5m in 2012 to £165.1m, while wholesale revenue was down 16% to £57.9m. Pre-tax profit dropped to £26m from £36m the year before, which Mulberry attributed to investment in directly operated international stores plus a contraction in gross margin
Bruno Guillon, chief executive of the luxury label, said: “Mulberry has a well-established business in the UK and a growing presence in Europe. With over 80% of our sales derived from these markets where the economic climate remains difficult, Mulberry’s challenge for the future is to accelerate our brand awareness in the USA and Asia.”
He added the label has had a “year of consolidation” in which Mulberry is “transitioning” from a “UK sucess story into a global luxury brand.”
However the brand reported an 8% increase in retail revenue for the period bringing the total to £107.2m. Mulberry also said that retail revenue for the 10 weeks to 8 June 2013 was up 9% with like-for-like sales up 6%.
Earlier this week the brand confirmed the departure of its creative director Emma Hill after more than five years at the helm.